τι λες;
ρίαλυ;
The economic performance of nations is shaped by private sector activities as well as by public
policies. In most countries, the public sector accounts for a non-negligable part of the total
economy. Based on several measures capturing the supply of public goods and services, though,
the size and the structure of public sectors differ markedly across countries. When measured in
terms of public employment, the governmant size in the EU is not much different from that in
the US (with Japan trailing far behind the other two regions). In terms of the share of public
expenditures (or taxes) in GDP, however, the public sector is much larger in the EU than both in
the US and in Japan. The EU15 stands out because of its significantly larger share of
expenditures for social protection and general public services.
Due to the sheer size of public sectors and their contribution to overall economic performance
and productivity in industrial countries, it seems worthwhile to devote more research efforts to
the development of performance indicators which would allow meaningful comparisons over
time and countries. Such comparisons could be usefully employed to develop benchmarks for
public sector reforms, the necessity of which is acknowledged in most industrial countries. They
could also help disentangle the contributions made by the public and the private sector to
growth and productivity differences between Europe and the US and thereby assist policy
makers in their endeavour to pursue the goals of the EU's Lisbon strategy.
From the scarcely available empirical literature it seems that public sectors in the euro area
perform rather poorly on average. Production frontier analyses of government outputs and
inputs reveal that the US and Japan are among the most efficient countries, while euro area
member states in general lie well inside the production possibility frontier, implying that much
less input would be required to achieve the same output. [size=18pt]However, there are remarkable
differences across European countries, some of which clearly outperform the US[/size]. [size=24pt]There is no
straightforward relationship between the size and the structure of government and its economic
performance[/size], although it seems that small governments are on average more efficient than large
governments. This evidence must be assessed cautiously, however, as the size of government is
not just related to efficiency, but also to the scope and quantity of services provided.
Because of the lasting pressure on governments to slash taxes, to improve the quality of services
and at the same time to keep the budget balanced, reforms in public administration have been an
obvious area to improve government performance. Although the instruments introduced in
practice (such as New Public Management) may not solve all the problems in the public sector,
permanent reforms are necessary to keep up with the innovative developments in the private
sector. Important directions of reform have been human resources management to improve
incentives to civil servants, and outsourcing to private service providers. Securing fiscal
stability over time and coping with implicit public debts calls for reforms to curb the built-in
expenditure drivers while raising the cost effectiveness of public spending. To improve the
effectiveness of public spending, the budget process per se has been a target of reform in many
countries, considering the introduction of fiscal rules, extending the planning horizon, reducing
budget fragmentation and focussing on spending outcomes. Unfortunately, without adequate
measures of public sector output, only very few and vague statements can be made.
[size=24pt]Comparisons of public sector productivity over time and countries are nearly impossible and
policy recommendations to improve productivity are either common sense or speculative.[/size]
